WASHINGTON—After falling more than seven points in January, the consumer sentiment index rebounded to 95.5 in February, according to preliminary results from the
University of Michigan's Surveys of Consumers.
The survey's chief economist, Richard Curtin, attributed the gains to the end of the partial government shutdown, as well as the Federal Reserve's decision to pause interest rate hikes.
NAFCU Chief Economist and Vice President of Research Curt Long addressed the Fed's pause in interest rate hikes given the recession in inflationary pressures following the release of January's consumer price report last week.
"The lingering impact of the shutdown was responsible for some of the negative economic evaluations, and, at the time that these interviews were conducted, uncertainty about whether a second shutdown would occur continued to have a slight depressing impact on confidence," Curtin said. "Although the majority of consumers expected some additional rate hikes during the year ahead, that proportion has shrunk to the smallest level in the past two years."
In addition, the February survey revealed that personal consumption expenditures are likely to remain the strongest sector in the economy this year.